Still, investors appear enthusiastic. Even as transaction activity for other multifamily property types was off 6% at about $80 billion through mid-2008 from a year earlier, student-housing deal volume actually rose by 1% to $2.5 billion, reports Real Capital Analytics. However, that figure includes a major deal in which American Campus Communities acquired GMH Communities Trust for more than $1 billion.

And there is more room for consolidation in student housing. For now, Education Realty Trust, American Campus Communities, and privately held Philadelphia-based Campus Apartments control about 5% of the fragmented market.

In a downturn, more people tend to head back to school to become more marketable. Some students even decide to extend their stay at universities or enroll in graduate school, rather than battle a weak job market.

Whether such factors will be enough to buffer the sector remains to be seen. “We've been through bad economies before,” laments Bower, “but I don't know that anyone has been through anything like what we're going through right now.”

Poonkulali Thangavelu is senior associate editor.

TOP STUDENT HOUSING DEALS

The biggest student housing property transaction for the 12-month period ending Sept. 30 was the $275 million sale of Gramercy Green, a 304-unit property in New York. The price was more than three times the size of the next-largest acquisition. Following is a list of the top five deals.

Portfolio: The self-managed REIT owns 86 student housing properties totaling 52,800 beds. The company also owns a minority interest in 21 joint-venture properties containing 12,100 beds.

Source: Company reports, MarketWatch